European trading volumes enjoy bright spring

Europe’s
equity trading volumes enjoyed a 5% monthly rise in March and were over €80 billion higher than the €703 billion recorded during the same period in 2011.

Total trading across lit and dark European equity trading venues reached €787 billion last month, higher than the €740 billion recorded in February, according to figures from Thomson Reuters' Equity Market Share Reporter.

While retaining its status as the region’s largest single venue, pan-European multilateral trading
facility (MTF) Chi-X Europe lost a percentage point for the first time
in 12 months, from 20% in February to 19% in March. Nevertheless, the MTF still traded more than it did in March 2011 (17%). Combined with fellow MTF BATS Europe, whose parent company BATS Global Markets recently acquired Chi-X Europe, the dual MTF transacted 24.3% worth of the region's share trading last month, up from a combined total of 23% in March 2011.

Among the
primary exchanges, Deutsche Börse’s Xetra cash equities platform increased its market share to 14%, up from 13% last month, while the London Stock Exchange's UK market held steady at
12%, unchanged from a year earlier.

Record dark turnover

Dark MTFs recorded their highest volumes to date, reaching €30.46 billion in March, versus €28
billion in February and €24 billion a year ago. However, total European dark
trading – including broker crossing networks (BCNs) – actually fell slightly as a
proportion of Europe’s total order book, from February's record of 7.65% to 7.24%. BCNs traded a total of €30.63 billion last month, according to figures from Markit as reported to Thomson Reuters.

Among the
dark MTFs, the biggest winners were Chi-X Europe's Chi-Delta, which increased its share
from 23% to 25%, and agency broker ITG's POSIT dark pool (13% to 14%). The biggest losers were BATS Europe, which fell 2% month-on-month to end March on 9%, and Turquoise, which fell from 9% to 7%.

Despite
their popularity with investors, the European Parliament has cast doubt on the
future of Europe’s BCNs, with a proposed amendment to MiFID II that would
effectively force BCNs – which are currently not formally recognised under
MiFID and therefore fall under the definition of OTC – to reclassify as
systematic internalisers or MTFs. Recategorising
as an MTF would mean BCN operators lose the ability to decide who can access
their venue and how trades are matched – factors
cited by institutional buy-side firms as key attractions of the venue type.